GST Exemption Denied for Services to K-DISC

Centax Editorial Board

December 18, 2025

• 2 min. read

Case Details: In re: Information and Communication Technology Academy of Kerala (2025) 37 Centax 95 (A.A.R.-GST-Ker.)

Judiciary and Counsel Details

Jomy Jacob, Member (Central Tax) & Mansur M.I., Member (State Tax)
Shri Jayaprakash Devendran, Chartered Accountant, for the Assessee.

Facts of the Case

The petitioner, a skill development company, supplied training and capacity-building services to the Kerala Development and Innovation Strategic Council (K-DISC) under memoranda of understanding, raising invoices and receiving payments accordingly. The petitioner sought GST exemption under Entry 72 of Notification No. 12/2017-C.T. (Rate), dated 28-6-2017, contending that K-DISC is a government department and that the programme expenditure was borne by the government. Records indicated that the Government permitted registration of K-DISC as a society, and K-DISC’s own correspondence and website confirmed its status as a society reconstituted from May, 2021. While the application was admitted for determination of notification applicability and input tax credit issues, the legal status determination was held outside the remit of Section 97 of CGST Act. The matter was accordingly placed before the Authority for Advance Rulings (AAR), Kerala.

AAR Held

The AAR held that exemption under Entry 72 requires the recipient of services to be a government entity, with not less than 75% of the expenditure borne by the government. Although the funding condition was satisfied, K-DISC, being a society distinct from the government, did not qualify as a government or local authority. Further, Entries 3 and 3A under Notification No. 16/2021-C.T. (Rate), dated 18-11-2021, exclude governmental authorities or entities, and Entry 3B by Notification No. 13/2023-C.T. (Rate), dated 19-10-2023 covers only specific services such as water supply, public health, sanitation, solid-waste management, and slum improvement, with skill development not included. Accordingly, the AAR ruled that the supply of services to K-DISC was not eligible for GST exemption.